Does RIM's "Huge Loss" Signal Wider Handset Market Deterioration?

zacharye writes "RIM was expected to deliver a nightmarish, -30% year-on-year revenue decline into the May quarter — the company issued its latest profit warning just four weeks ago. Yet it ended up missing the lowered consensus estimate by 10%, generating just $2.8 billion in sales. The reasons for RIM's decline are well-known and will be rehashed again over the next 24 hours. But the size of the F1Q13 sales miss raises another question: apart from Apple and Samsung, is the handset industry drifting into serious trouble?"

Comments

No

[ghn]

Look at apple's profits.

And please stop the sensationalist question mark titles.

Re:No

[hairyfeet]

Actually the reason RIM is gonna end up toast is the same reason we have seen tons of other companies go from being the big cheese to just another small fry, hell its the same reason we are seeing MSFT throw the Hail Mary of the century with Win 8 in Oct, and that is they didn't see the disruptive shift in the market coming and instead of innovating they sat on their laurels.

There is no reason that Blackberry couldn't have branched out, they could have had sleek elite lines like Apple and entry lines like Android, but like many corps they got fat and sat on their asses and the world passed them by. Seriously how many times have we seen this play out? RIM, Palm, the above mentioned MSFT, Nokia, these corps become the king of their respective hills and instead of staying hungry and growing they plop down and just count the money...right up to the point the Mac truck that is the changing tech scene runs their asses smooth over.

if you want to sit on your ass? tech is NOT the market you want to be in. just look at how much things have changed in the last decade, the end of the MHZ wars and the rise of multicores in the PC market, the death of the dumbphone for smartphones, netbooks and tablets appearing out of thin air, if you try to set on your ass in the tech world somebody will come along and kick you right in the ass, simple as that. RIM had a sweet thing going with business users but instead of doing the smart thing which would have been branching out into new markets, developing new exciting designs, and trying to stay ahead of the curve, they basically pulled a Palm and just rehashed what they had. Bad move RIM and now it looks like you're toast.

Just because you build it doesn't mean they'll ...

[Gr8Apes]

No, it's not the end of the handset industry, nor are they in trouble. It's an industry that 80+% of the users toss their perfectly good handset every 18-24 months because their contracts generally make it worthwhile to do so. Just try to get a decent contract with a reasonable monthly fee that's lower than getting the same contract with a brand new shiny phone attached. However, just because you make a handset doesn't mean people will buy it, especially if that handset comes at virtually the same price or within easy disposable income range of the top of the line handsets. Why would you buy a Yugo if for $10 more you can own a Lexus?

Re:Obvious?

[Anonymous Coward]

You don't disrupt a market by being a follower. Being a follower is always a volume business, you are just there to run a numbers game.

In apple's case they re-wrote the rulebook and turned the first question abotu every product into "But is it better than apple's offering". Once a single player is in that position t becomes very hard to unseat them by simply copying. You need to change the rules again to win that game.

No competition

[Anonymous Coward]

Who can make a phone with all the patent traps?

Microsoft Deserve credit too

[Freaky Spook]

In apple's case they re-wrote the rulebook and turned the first question abotu every product into "But is it better than apple's offering"

Microsoft expanding their ActiveSync license program as well I would contribute to helping the iPhone succeed. Suddenly you didn't need to invest in expensive BES licensing costs, windows licensing and hardware costs just to connect a phone to a mailbox. When that happened I wondered just exactly how Blackberry would react to the market, and well they didn't.

Re:Obvious?

[Dynamoo]

RIM must be smarting because it *was* a market disrupter.. it's just that the market continued to evolve. Their problem now is.. how to disrupt the market again? I honestly don't think they can do it without radical and painful surgery to their business model.

My two cents worth.. RIM should dump plans for BB10. The world doesn't want another mobile OS, regardless of how good it might be from a technical POV. RIM should slot itself in with Android or perhaps Windows, but then differentiate itself with its software and services offerings (e.g. BBM, BES etc). If you offered me a truly enterprise-capable Android phone I would rip it out of your hands! Sure, margins will be thinner and the glory days will be behind them.. but they would probably survive, and that gives them time to look at the next way of disrupting the market.